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Christie Young
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  • Only 0.5 percent of all of Canada's land is considered class 1 farmland (according to the Canada Land Inventory), which means it has no significant limitations for farming and has the highest productivity for a variety of crops. More than half of this land is found in Ontario.We need to protect all our class 1-3 farmlands. And we need to make sure that these lands are being used productively. By owner operated farms.
  • Farmland is being lost to development at It can take thousands of years to produce one centimeter of the topsoil needed for agricultural production.
  • Farmland is being lost to development at It can take thousands of years to produce one centimeter of the topsoil needed for agricultural production.
  • Farmland is being lost to development at It can take thousands of years to produce one centimeter of the topsoil needed for agricultural production.
  • What IS OUR DREAM FOR THE FUTURE? Ecological agriculture - which at the root means - healthy, dynamic living soil ecosystems, diversity, integrated farm operations - which minimize off farm inputs and the reduction of energy use.
  • What IS OUR DREAM FOR THE FUTURE? Ecological agriculture - which at the root means - healthy, dynamic living soil ecosystems, diversity, integrated farm operations - which minimize off farm inputs and the reduction of energy use.
  • We need to change how we approach our farmland ownership and stewardshipWe need creative ways to help new farmers access farmland - that they may be able to own or not own. With easements, long term leases, farmland trusts. Farm coops.
  • Transcript

    • 1. 1Supporting a NewGeneration of FarmersFARMSTART
    • 2. 50% of our farm assets will betransferred75% of our retiring farmersdon‟t have successorsAgriculture Agri-Food Canada, 2006In the next 10 years…
    • 3. Speculative land values„Sun-set‟ agriculture“Crisis” farm salesChallenges of FarmlandTransfer
    • 4. New Entrants
    • 5. Innovation, Diversification, Resilience
    • 6. Farm Community Revitalization
    • 7. 900 registered users ~ 390 active farm-seekers ~ 150 active farm-listings
    • 8. 40,000 eat Soup to “save the farmlands that feedus!”
    • 9. Community FinancedFarms> Shared farm modelFarmland Futures Equity Fund> Succession, lease-to-ownFarmlands for FarmersFeasibility Assessment of 2 models
    • 10. COMMUNITY FINANCED; SHARED FARM MODELOwner NGO owns and managesOn-going Management and maintenance carried by rents from farmers.Land Base Divides into several distinct lease sections, minimum 20 acres workable. Some sharedinfrastructure.Likely for intensive vegetable production and small animal operations.Housing • Farms on settlement boundaries don‟t offer housing?• Build housing units in a “living centre” close to original homestead?• Sever housing lots and tie to land rents?Tenure Land leases and housing leases.5 years to start, then 60 years ?Equity Farmers can sell their farm business and access to lease, &leasehold improvementsFinancing Community Bonds & Patient mortgage holderReturn onInvestmentRents from farmers.Fixed ROI for bond holders;Amortization of mortgage?Income tax breaks for farmland easement?Exit of Capital Optional buy back of Bonds? Amortization of loans?Farmland Protection NGO holds land forever, for farming, (Easement?)Risks Lack of investment; Economic crisis (reducing investor appetite)Planning rejections;zoning/ planning problemsDifficulty in negotiating for landRapid changes in land pricesRapid changes in interest ratesTenantturnover, RFPs increase management costs, breaks in cash flow
    • 11. FARMLAND FUTURES; LEASE TO OWNOwner Fund buys farm. Original farm owner can stay lease free for 10 years.Fund places a farmland easement on the property.Land Base Full farm and infrastructure.Any scale or type of production.Housing Build secondary house for new entrant, if not there. (close to original farm house on property;or on „retirement‟ lot – that can be tied to the farm property?)Tenure Net Farm lease,5-year terms with on-going right to renew and option to buy?Or lease-to-own after 5 years?Equity Farmers can sell business and right to renew lease?Farmers have right to purchase, so can invest in business in start-up stage.Financing Equity Fund Investors & a Patient mortgage holder.Return onInvestmentRents from farmers.Investor dividends. Appreciation?Interest and Amortization of mortgage loan?Income tax breaks for farmland easement?Exit of Capital Sale capital in a lease-to-own arrangement.Farmland Protection Farmland easement held by Ontario Farmland Trust, must be used for farming.Risks Lack of investment; Economic crisis (reducing investor appetite)Planning rejections;zoning/ planning problemsDifficulty in negotiating for landRapid changes in land pricesRapid changes in interest ratesTenantbusiness fails, new tenant negotiations take time
    • 12. 1616OPTIONS FOR FARMERSWhat will motivate the retiring farmers to be involved?What value can we offer them?How can we negotiate a reasonable sale price?How do we offer a reasonable rent for new entrants?IMPACT INVESTINGHow can we find large patient capital partners?What are reasonable returns on investment?EXIT STRATEGY FOR INVESTMENT CAPITALHow do we create the ability to get investment capital out?Esp. if we don‟t sell the farm?And if we sell the farm with an easement, for less than purchase price?PLANNING AND TAX IMPLICATIONSDoes this require charitable income tax receipts for farmland easements?Are the costs of planning exemptions too much?Implementation of PPS is varied across municipalities. Can we influenceplanning approach changes to make it easier over time?
    • 13. 17Prime farmland protectionTax incentives (for farmers andinvestors)Community Investment ToolsChanges in planning policiesShared savings programs for newfarmers (RFSP)Enabling Environment
    • 14. Our Farmlands for FarmersFeasibility Assessment issupported by:Our Supporters
    • 15. 21FARM A 2009 2010 2011 2012Gross income 23,000 162,000 247,000 328,000Expenses 15,000 81,000 123,000 164,000Net income 8,000 81,000 124,000 164,000FARMB 2009 2010 2011 2012Gross Income 102,000 147,000 182,000 269,000Expenses 98,000 99,000 110,000 182,000Net Income 4,000 48,000 72,000 87,000Farm B owns 100 acres,,approximately 20 in production. 2lead farmers, who work part time offfarm.Expenses include salary.Farm A leases 7 acres, primarilygreenhouses production. 2 leadfarmers.Expenses include salary.FARM C 2009 2010 2011 2012Gross Income 19,000 38,000 64,000 84,000Expenses 14,000 48,000 50,000 44,000Net Income 5,000 -10,000 14,000 40,000FARM D 2008 2009 2010 2011 2012Gross Income 34,000 50,000 67,000 76,000 80,000Expenses 25,000 32,000 37,000 40,000 46,000Net Income 9,000 18,000 30,000 36,000 34,000Farm C rents 5 acres of land. 1lead farmer who works part time offfarm.Expenses do not include salaryFarm D leases 5 acres of land onanother farm, for no rent. Lead fulltime farmer.Expenses do not include salary.New Farmers : The complexity of Start Up, Viability and Equity